Mexico Cites Advances in U.S. Talks to Avert Trump's Tariffs
U.S. and Mexican negotiators are set to resume talks with time running short to avert Trump’s threat to impose tariffs next week.
(Bloomberg) -- Mexican Foreign Minister Marcelo Ebrard said negotiators looking to avert Donald Trump’s threat to impose tariffs over illegal migration had made unspecified advances, but a Trump aide predicted the duties will take effect next week.
“Talks will continue this afternoon -- they’re not over yet -- I think they are advancing,” Ebrard told reporters in Spanish at the State Department, where he met with unspecified U.S. officials Thursday. “In the afternoon, I’ll be able to give you a more concrete update.”
Earlier, though, White House aide Mercedes Schlapp said that Mexico hadn’t offered to do enough to curb migration to the U.S.
“It looks like we’re moving towards this path of tariffs, because what we’ve seen so far is that the Mexicans, what they’re proposing, is simply not enough,” Schlapp said in a Fox News interview.
Staff-level meetings are scheduled to start at 2 p.m. at the White House, a U.S. official said. A meeting between Ebrard, Vice President Mike Pence and Secretary of State Mike Pompeo on Wednesday ended without a deal, both sides said there was progress.
Pence and Trump are both traveling today, and it’s not clear if a deal can be closed without them. The president urged Mexico to make more concessions.
“We’ve told Mexico the tariffs go on” if no deal is made, Trump told reporters in France, where he spoke at a commemoration of the 75th anniversary of D-Day. “They have to step up to the plate.”
Trump said progress was made during the 90-minute meeting at the White House on Wednesday and that “something pretty dramatic could happen” in the coming days. But he continued to hold out the threat that the U.S. will follow through with tariffs on Monday.
“If no agreement is reached, Tariffs at the 5% level will begin on Monday, with monthly increases as per schedule,” Trump tweeted Wednesday. “The higher the Tariffs go, the higher the number of companies that will move back to the USA!”
The peso was trading at 19.7456 per dollar, down 0.8%, at 1:02 p.m. in New York, as the currency reeled from the U.S. tariff threats and more pessimistic assessments from ratings companies. Moody’s Investors Service on Wednesday cut Mexico’s outlook to negative from stable, and then Fitch lowered the nation’s sovereign rating to BBB from BBB+.
But Ebrard, after the meeting, said he was optimistic the two sides could reach a deal.
“We are optimistic because we had a good meeting with respectful positions from both parts,” Ebrard said during a press conference Wednesday at the Mexican Embassy in Washington. “We had an opportunity to explain our point of view.”
Ebrard said they didn’t discuss the tariffs during the meeting with the U.S. delegation, which also included Acting Homeland Security Secretary Kevin McAleenan.
Trump last month announced a 5% tariff on all imports from Mexico unless the country takes “decisive measures” -- as judged by his administration -- to stem migrants entering the U.S. He said the tariffs would begin June 10 and scale up incrementally until they reach 25% on Oct. 1. Mexico is the second largest source of U.S. imports after China.
Trump isn’t only threatening Mexico trade with tariffs. He reiterated on Thursday that the U.S. is prepared to place levies on another $300 billion of imports from China if necessary and asserted that Beijing “wants to make a deal badly.”
“A lot of interesting things are happening,” he added.
Trump said earlier in the day he thought Mexico also wants to reach an agreement. “I think they want to make a deal and they sent their top people to try to do it,” he said Wednesday in Ireland.
Democratic Senator Chris Murphy of Connecticut called Trump’s deal-making skills “a con job” on Twitter Thursday. “Trump says everybody wants to make a deal and we’re way past the halfway point of his presidency and no one has made a deal,” he wrote. “Not China. Not Iran. Not North Korea. And the one deal he did do, with Mexico and Canada, he’s in the process of destroying.”
On Wednesday, Ebrard highlighted some differences. While the U.S. is looking for measures to take effect “immediately,” Mexico wants to take steps that are longer term and “not just punitive.”
The White House has so far been vague about what Trump, the self-avowed “Tariff Man,” expects Mexico to do to avoid the duties. But White House trade adviser Peter Navarro offered what appeared to be an opening salvo in negotiations earlier Wednesday, saying tariffs may not have to take effect if Mexico could meet three conditions, including keeping U.S. asylum seekers in that country.
“The most important thing is for the Mexican government to take the asylum seekers,” Navarro said in an interview Wednesday on Bloomberg TV in Washington.
The number of apprehensions and people denied entry along the U.S.-Mexico border has been rising steadily. More than 144,000 people were apprehended after illegally crossing the southern border in May or were refused entry to the U.S., Customs and Border Protection announced on Wednesday. That’s the the most in a single month in at least five years; the number has grown every month since January.
Read More: Mexico Turns to Brazilian Corn as Tensions With U.S. Escalate
Most of the apprehensions are families or children traveling alone, pressuring a U.S. immigration system that has struggled to humanely detain and care for them.
The White House has said there’s an emergency at the border and demanded that Mexico accept the asylum seekers, step up patrols of its own southern border and strengthen checkpoints along the route migrants travel.
Ebrard acknowledged the influx.
“The starting points for both parties is that we recognize that the current situation can’t remain as it is,” Ebrard said during the press conference. “Because the numbers reported, the flow of people, effectively, are growing far too much.”
Republican lawmakers have warned against the Mexico tariffs and are pushing for a deal. Senate Majority Leader Mitch McConnell told administration officials that Trump should hold off on any tariffs until he can personally make his case to lawmakers.
In the Democratic-led House of Representatives, Ways and Means Chairman Richard Neal said he will introduce a resolution of disapproval to cancel any national emergency declaration that would be needed to give Trump the authority to unilaterally impose tariffs.
“Commandeering U.S. trade policy to influence border security is an abuse of power,” Neal said in a statement. “If the president does declare a national emergency and attempt to put these tariffs into place, I will introduce a resolution of disapproval to stop his overreach.”
A similar resolution to cancel a previous national emergency Trump declared in February was adopted in both chambers, but House Republicans halted an effort to override Trump’s veto. If Neal introduces another resolution, it would likely meet the same fate.
The tariff threat also cast doubt on the future of Trump’s update of the North American Free Trade Agreement, a key accomplishment of his first term. The new trade pact, called the U.S.-Mexico-Canada Agreement, was already at risk of stalling in Congress. The Trump administration wants it passed by summer.
--With assistance from Justin Sink, Anna Edgerton and Carlos Manuel Rodriguez.
To contact the reporters on this story: Josh Wingrove in Washington at jwingrove4@bloomberg.net;Nacha Cattan in Mexico City at ncattan@bloomberg.net;Nick Wadhams in Washington at nwadhams@bloomberg.net
To contact the editors responsible for this story: Alex Wayne at awayne3@bloomberg.net, Justin Blum, Joshua Gallu
©2019 Bloomberg L.P.